U.S. markets experienced a downturn at the end of the week due to a shift in investor sentiment following the recent presidential elections.
The S&P 500 fell by 1.32%, while the Dow Jones Industrial Average and Nasdaq Composite saw declines of 0.7% and 2.24%, respectively. Europe's Stoxx 600 index also experienced losses, falling by 0.77%. The U.K. economy grew by only 0.1% in the third quarter, falling short of the expected 0.2%.
The election results have significant implications for U.S.-China relations, as President-elect Donald Trump is expected to take a more aggressive stance on trade. This could lead to retaliatory measures from China, potentially impacting U.S. companies operating in the region.
The earnings season is underway, with Nvidia's upcoming earnings report anticipated to set the tone for market movements. Recent weeks have been volatile due to the election results, Federal Reserve rate cuts, and fluctuating inflation readings. The "Trump trade" initially drove markets to new highs, but they ended the week below these milestones.
Pharmaceutical stocks were negatively affected by Trump's announcement of his intention to nominate Robert F. Kennedy Jr. for the position of Secretary of Health and Human Services. The space sector, on the other hand, has seen a surge in stock prices, driven by positive earnings news and investor interest in emerging industries.
As the market adjusts to the election results and potential policy shifts, micro volatility is expected to persist. It is important for investors to navigate these changes with caution and adaptability.